UBS’s former chief executive has branded the traders involved in Libor-rigging
at the Swiss bank as “mercenaries” and said he wanted to see an end to the
bonus culture in investment banking.

Marcel Rohner, who ran UBS from mid-2007 to early 2009, blamed traders hired from rival firms for the rate-fixing scandal that last month saw the bank fined a record $1.5bn (£924m).

“In these pockets where we had these problems, there wasn’t actually a bad culture, it was a lack of culture,” Mr Rohner told MPs on the Commission on Banking Standards. “When you grow a business too quick and you hire people from many different places; some of them I would say... we would clearly have to qualify as mercenaries.”

Mr Rohner said many bankers were still paid too much as he argued that “very few in a bank could claim they could set up their own business and be as successful”.

Speaking later, Sir Hector Sants – the former Financial Services Authority chief who was last month controversially hired by Barclays to run its global compliance department – said the FSA had repeatedly warned UBS of its concerns about the way the Swiss bank’s London operation was being run.

According to Sir Hector, UBS was told by the British regulators that they were unhappy with the bank’s management structure. He added that there was still a “significant problem” with banks operating in the UK through “branches” that left a “lack of clarity of who does what”.

The comments came after Mr Rohner and three other senior former UBS executives gave evidence to MPs and peers at the hearing.

All four men insisted they had no knowledge of Libor-rigging and had only learned of the investigation after it was reported by newspapers in 2011.

“The picture that is being presented here is one of gross negligence,” said Labour MP, Pat McFadden, while Andrew Tyrie MP, the chairman of the Commission, said the executives’ “ignorance” stretched “to the point of incredulity”.

Sir Hector said he was “extremely surprised” that the UBS managers had known so little about the investigation.

On Tuesday, the Commission was told by three current senior managers at UBS that of the 40 staff implicated directly in Libor-rigging, only 18 had been dismissed by the bank.

Tracey McDermott, head of enforcement at the FSA, yesterday told the Commission that of these traders, just nine fell within the “UK’s regulatory net”. Ms McDermott declined to give further details of what action was being taken against the men due to the ongoing criminal inquiries and would not discuss whether an extradition request had been received for two of the men named by the authorities.

Former UBS trader Tom Hayes was arrested last month in connection with allegation of Libor-rigging. Mr Hayes worked in the Swiss bank’s Tokyo office trading financial products linked to Yen Libor. In collaboration with other traders and brokers he is alleged to have manipulated Libor for profit.